With the holidays fast approaching, consumers are understandably concerned about the impacts of inflation, supply chain issues, and recommendations from retail experts to shop even earlier than normal.
Add in the fact that four in 10 (42%) of Greater Philadelphia and Delaware region consumers are saving more now than they were earlier in the pandemic because they want more financial stability, according to a new WSFS Bank Money Trends study, and it explains why consumers are preparing to spend less on gifts, dining and travel this holiday season.
There are ways to navigate these challenges, however, by making small changes to how we spend and save while still enjoying the holidays.
Having trouble finding a gift for a friend or family member because there are simply too few of what you are looking for available?
Turn to your local small business retailers and “experience” providers. These businesses often have hidden gems that can make gift giving even more rewarding and personal, from unique items crafted by local artists to tickets to live community theatres or other events.
Have a thrill seeker in the family? Buy them tickets to local amusement parks or a locally owned indoor skydiving franchise.
Stumped for affordable ideas altogether? Give the gift of cash!
The WSFS survey found that 61% of respondents who are planning to shop local said they will because they want to support local businesses and nearly half (49%) prefer the personal touch of buying gifts from small businesses.
This year, you may need to think creatively to find the right gifts for your loved ones and doing so while supporting your local business community is a win-win.
Be Mindful of Rising Prices
While inflation and rising prices for commodities like gas and oil are concerning, there are ways to lessen the impact on your day-to-day spending.
In many cases, consumers are finding alternative products or holding off on buying larger purchases, as 35% of area respondents said they are not purchasing products that have become too expensive, and nearly one-quarter (24%) said they are delaying a large purchase, like a car, due to higher prices.
Others are making different arrangements for their holiday shopping to save money on gas, such as combining their shopping trips to save on gas (27%) and nearly one-quarter plan to travel less overall this holiday season.
Set Your Budget Now and Consider Your Payment Options
If you haven’t already set your holiday spending budget, now is the time to do it. Whether you are using cash to pay for gifts and entertainment or payment apps or credit, its important to stay on course and avoid spending more than you can afford.
A recent Cash Connect and OnePoll study revealed that 40% of consumers nationwide prefer to use cash as their payment method, and 51% of respondents agreed that using cash helps them budget their money. Cash still plays a big role in spending, saving and budgeting.
There are also opportunities to earn money through rewards credit cards, ultimately saving money on your purchases by applying cash rewards to your end-of-the-holidays payment.
You can also add a layer of security by connecting your bank account or credit card to Peer-to-Peer (P2P) apps like Zelle®. Zelle is a great option for safely sending (including cash gifts) and receiving money from friends, family and some small businesses.
Other P2P apps like Venmo and Apple Pay can connect to your credit card or bank account but may charge fees, so factor that in when deciding on which app to use.
Whichever options you choose to spend your holiday budget, make sure to stay within your means and enjoy the season!
Helping you boost your financial intelligence.
Read our financial resources from your friends at WSFS.